Somerset council tax relief could be cut from April 2025

Somerset Council currently operates a council tax reduction scheme, providing discounts for single people, couples and families.

The council currently spends around £29m on these discounts, of which nearly £16m funds discounts to people of working age.

In light of its ongoing financial pressures, the council has launched a consultation on making changes to the scheme, which would save more than £6m a year by reducing the amount of discount available.

The council’s executive committee met in Taunton on July 15 to discuss the proposals before the consultation was formally launched.

A total of 32,241 council tax payers currently receive some form of council tax reduction.

Somerset Council has been battling a financial emergency since November. (Image: Daniel Mumby)

While the council gets to set how much relief is provided to working age people on low incomes, central government sets the amount of relief which can be provided to low-income pensioners.

Four separate proposals are being consulted upon, which could save the council a combined £6.4m per year:

• Reducing support for working age applicants (£4.8m): this form of relief is based on your weekly income (i.e. the more you earn, the less discount you receive). If these proposals are approved, all working age applicants will end up paying more council tax than they currently do. For instance, a single person earning £100 a week would get a 75 per cent discount, rather than 100 per cent, while a couple with two children earning £500 a week would see their discount cut from 25 per cent to ten per cent
• Introducing a standard non-dependant deduction (£1.5m): the council wishes to introduce a flat rate deduction of £10 per week for every non-dependant living with the ratepayer (such as a son or daughter aged 18 or over). For instance, if a ratepayer receives relief of £30 per week and lives with two grown-up children, this relief will be cut to £10 per week
• Restricting support to Band D Council Tax levels (£86,000): the council currently provides relief on all eight bands of property, with Band A being the lowest and Band H being the highest. Under these proposals, relief would only be available to those living in Bands A to D – meaning people living in larger or more expensive houses would pay more council tax
• Restricting the back dating of council tax reduction (TBC): currently, if you apply for a council tax reduction, the council can backdate the award by up to 12 months depending on people’s individual circumstances. Under this proposal, any backdating would be fixed at one month

Other eligibility criteria for council tax relief will remain unchanged, including:

• No relief for those with more than £6,000 in capital
• War pensioners’ pension levels will be disregarded
• The exceptional hardship scheme will remain in place
• The first £30 per week for disabled people will continue to be disregarded

A further two changes were originally included within the executive papers – namely removing the disregard of £25 per week from earning calculations and including certain incomes which are currently disregarded, which could have generated nearly £6m in annual savings.

However, these were removed following the executive’s discussion due to concerns that they would hit the most vulnerable in Somerset (including those with disability) too hard.

Councillor Theo Butt Philip, portfolio holder for transformation and human resources, said: “Council tax, as we all know, is a fundamentally unfair and unstable way of funding local government.

“Until we get a government which will have the foresight and courage to do something different, we have to try and make as fair as we possibly can.

“The scheme we have, I think, is fundamentally well-structured – although it is not as generous as we might like to think.

“I understand that, because of the financial emergency we face, we have to look at all the options that there are.

“But within the options before us today, there are certain things which I am, to put it mildly, deeply uncomfortable about – in particular, the proposal to remove the disregards for disabled people and carers.

“The idea that we are going to balance our budget off the backs of disabled people and carers is something I do not think I can countenance – it’s just wrong.

“If people haven’t got the money, they’re not going to pay us – and then we’ll spend time and money chasing them for money they don’t have.

“Paying for food and heating is far more important than paying your council tax – I’m not going to argue with that decision. We’re here to make people’s lives better.”

The consultation will run online until early-October, with the final proposals being agreed before Christmas to ensure the new system is in place by the time the council sets its next budget in mid-February 2025.

Somerset Council leader Bill Revans.

Speaking after the executive meeting, council leader Bill Revans said: “We fully recognise and appreciate the value of council tax reductions to those on low incomes – in fact, one of our first decisions as a unitary council was to harmonise this support for everyone across the county.

“However, the national model of funding local government is broken. The costs of providing key demand-led services have risen sharply and we have limited ways to raise income.

“Without national intervention, this means we have no choice but to consider all available options to reduce spending.

“But we will not do this lightly and it’s really important that people understand the changes being proposed and have their say so we can consider every impact before any decisions are made.”

To take part in the consultation, visit www.somersetcouncil.citizenspace.com/comms/ctr before October 1. 

Paper copies will also be available in all Somerset libraries and letters will be sent by post to all those who currently receive council tax support.

Any agreed changes to council tax support will come into effect on April 1, 2025, once the council has agreed its annual budget.